Simplifying Provider Credentialing in Oregon: A Cautionary Tale for All States

As states work to simplify the health care delivery system for consumers, a recent decision in the state of Oregon could soon have national implications.

The state suspended a legislatively mandated provider credentialing program before it could be launched — after five years of startup activities. The well-intentioned program never got off the ground due to both market realities and the complexities associated with building a provider credentialing solution from scratch. Other states should view this as a cautionary tale when it comes to simplifying health care administration.

Provider credentialing is a critical process that collects and verifies data related to a medical provider’s education, training, experience and competency. This process achieves two objectives: ensuring that health plans maintain up-to-date networks of health care providers, and enabling patients to confidently choose a provider for their health care from those networks.

The recently suspended Oregon Common Credentialing Program was enacted through Oregon Senate Bill 604 in 2013 and intended to simplify provider credentialing in that state. The legislation required the Oregon Health Authority to establish a statewide program built around a database to streamline access to credentialing information. The program was aimed at reducing costs and administrative burdens by eliminating duplication and centralized data collection.

OHA discovered the very same obstacles that similar industry solutions encountered: These programs are more complex, more expensive and take longer to implement than predictions indicate. Its suspension notice stated: OHA encountered significant challenges in designing a program that addressed the complexities of business practices while meeting accrediting entity standards for credentialing.”  

Oregon had another option, as do all states. It could have partnered with one or more of those proven, efficient industry credentialing programs. An example is the National Association of Vision Care Plans’ Universal Credentialing Alliance, which credentials optometrists and ophthalmologists but is applicable to any medical provider type. Created by our affiliate organization, the nationwide primary source verification program costs less than $18 to credential a provider every three years. By contrast, OHA’s proposed pricing structure required credentialing costs of $39-$270 per provider, depending on network size, over the same three-year period.

Industry solutions are successful and cost-effective because they were built to compete in the marketplace. They’ve had to achieve all the objectives OHA identified and hew to the unique regulatory requirements of every state; meet federal standards and accepted accrediting standards; facilitate provider interactions; securely safeguard collected data; effectively manage provider re-credentialing cycles and more.

The hard part is already done. The startup costs have long been recovered. The pathways to reduced administrative burden and costs are well understood. The focus now is on creating a better patient experience by simplifying administrative burdens for both plans and providers.

The lesson learned in Oregon is not isolated to provider credentialing. State-mandated provider directory programs are another administrative component that can be better addressed by industry.

In separate reports from 2012 and 2017, the federal Office of the National Coordinator for Health Information Technology indicated that centralized provider directory resources would be valuable tools for providing consistent information for health care consumer use. One solution: creating a national or centralized third-party clearinghouse or certifying entity as a centralized repository for that provider information.

The Centers for Medicare and Medicaid Services would appear to concur. In its “Online Provider Directory Review Report,” CMS states:

“ … The active participation and engagement of plan contracted providers is key to improving directory accuracy. We remain encouraged by several ongoing pilot programs aimed at developing a centralized repository for provider data accessible to multiple stakeholders. A centralized approach would make data collection and verification more efficient and less burdensome for MAOs and providers, and may result in more accurate and timely data sharing. … ”

The payer, administrator and network communities are ready to support all states’ efforts to be good stewards of public money and provide consumers with the best-possible solutions for health care administration. Tapping into proven, cost-effective industry solutions for improving health care administration can help achieve this goal. We are all after the same goal: access to the highest-quality health care for all Americans.


Julian Roberts is president and CEO of the American Association of Payers, Administrators and Networks.

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